A takeaway owner based in Knaresborough has been spared jail after admitting to a £50,000 VAT fraud, which spanned more than three years
Razaul Karim, 49, was spared jail in a hearing at York Crown Court after an investigation into his tax affairs found that he had unpaid £51,700 in VAT charges.
Prosecutor Timothy Jacobs said the business had operated for many years and that between 2013 and 2015, it was VAT-registered.
However, in 2015, Karim deregistered the business from VAT after claiming that the takeaway was under the income threshold for paying the VAT.
An investigation into the business was launched, which was aided by records from two delivery firms that provided services for the company. Records from August 2019 suggested that the takeaway’s turnover was way over the threshold.
The takeaway’s earnings for the years from March 2017 had exceeded the VAT threshold in delivered food alone, discounting purchases made in the shop.
The business’s turnover was just under £130,000, well above the £85,000 threshold. The total amount of unpaid tax was over £51,700.
In questioning, Karim attempted to blame his accountant for the tax irregularities but later owned up to the fraud.
Karim admitted four counts of fraudulent evasion of VAT. The offences spanned more than three years, between March 2017 and April 2020.
Judge Simon Hickey ruled that due to Karim’s clean record and otherwise ‘exemplary’ character, the fraud was ‘out of character’, perhaps because he was going through financially hard times.
The judge said that Karim had demonstrated ‘clear shame’ and remorse.
Hickey said: ‘I know that for a man of your standing and (in) your community, that’s a great penalty.
‘The authorities will pursue you, rightly, for their money and that’s one of the reasons I want you on the outside, still contributing, rather than in prison.’
Karim was given a two-year suspended prison sentence and ordered to pay a surcharge to fund victim services.
Negotiations are still underway on the amount that Karim will repay in unpaid VAT.